Smart Tip!Check Your Paycheck

When was the last time you reviewed your paycheck? If you have a direct deposit set up, you may rarely look at it or think about it beyond confirming that money was deposited in your account. However paychecks contain valuable information beyond your take-home salary and should be reviewed regularly. At Brannen CPA Services, we provide our clients with honest advice and relevant insights and we often remind our clients to regularly check their paychecks. This article discusses why you should review your paycheck today.

It’s a good idea to check your tax withholdings so you avoid owing the IRS more than you anticipated come tax time. Life events such as marriage, divorce, having a child, or buying a home may impact your taxes. Take a look at your paycheck and confirm the earnings are correct. It’s important to note that the IRS introduced a new W-4 form as part of the Tax Cuts and Job Act of 2018 and along with new income tax withholding tables. If you don’t withhold the proper amount from your paycheck, not only could you face an unexpected tax bill but you could also face a penalty.

You can use the IRS’s Tax Withholding Estimator to help discern if you need to adjust your tax withholdings and provide you with guidance on what steps to take. Consider using the tax estimator if you:

• Are part of a two-income family

• Work a seasonal job

• Claim the child tax credit

• Have a high income

• Received a large tax refund last year

• Had a tax bill last year

Reviewing your paycheck is a best practice that provides you with important information so you can keep your financial goals on track. If you have questions about your income tax withholdings or need help navigating the best way to update your W-4 form, please reach out! The team at Brannen CPA Services is here to provide client-centered tax and accounting services so you can find your strength in your numbers.